In-House vs Outsourcing Loan Services

Organizations need to implement the right servicing strategy to achieve maximum success in today’s environment. Increased regulation and greater customer needs have made choosing a servicing path harder than ever. In fact, it is possible that one dedicated sourcing model may not fit your company policies or requirements perfectly. To help you uncover what is best for you, here’s some of the differences between the two sourcing options:

OUTSOURCING

You can benefit from the expertise and resources of a larger, multifaceted team that you may not otherwise be able to afford. Having access to their experiences and efficiencies on call, when you need them, reduces immediate costs and ongoing overhead. There is no increase to your payroll or software to purchase and learn. But, probably the greatest benefit of outsourcing is the elimination of risk. Loan Servicing in today’s litigious world is hard work and a dangerous place to be without the best resources. A good outside servicer will be aware of, and in compliance with, any and all state and federal regulations. That leaves you free to do what you do best, originate loans.

IN-HOUSE SERVICING

The main advantages of this option are increased cash flow and better control.

You can develop, naturally, a deeper relationship with your borrowers and lenders. You can make informed decisions quicker, based on your knowledge of a borrower’s payment history, the amount of available equity AND the feedback from your staff. Additionally, keeping a pulse of your loans allows you to plan to re-deploy funds quicker as payoffs are coming in. By putting your lenders’ money to work sooner, you are keeping them happy and maybe funding an extra deal or two.

HOW TO MAKE THE RIGHT CHOICE

Determining the right strategy isn’t easy. Here are some tips to help you make the best decisions.

Define your Strengths and Weaknesses

– By doing this you will uncover the best use of your time and talents.

Determine your Needs – Many Servicing Companies can help you with Loan Processing and Doc Prep, Loan Servicing, Loss Mitigation and Foreclosure Services. Which, if any services, would compliment your strengths?

After evaluating your situation, if you believe that you and your staff can manage and service your portfolio efficiently and compliantly, your choice is clear. If you are uncertain, let me suggest that you consider meeting with a knowledgeable and reputable loan servicer. You may be able to work out a short term program that allows for a “working interview.” Then, after experiencing the process, you can make an educated decision on the best strategy for you.

Additionally, you have a third option that can ebb and flow with your business. You outsource only the servicing functions you feel best fits your strategy. You may want to do your doc prep and processing in-house and have a professional servicer do your collections or vice-versa. The point is you have the flexibility to choose.

Whatever you decide, you have the ability to adjust your path as your situation changes over time and through economic and regulatory shifts. I encourage you to review your situation quarterly and have a standing relationship with one or two qualified servicers to “go to” if needed.

Drew Louis is the cofounder and president of Del Toro Loan Servicing Inc. Drew can be reached at (877) 335-8676.

Featured Testimonials

AAA Private Money has worked with Del Toro Loan Servicing for many years. We have found their responsiveness to be the best in the industry, and the quality of the work they do has always met or exceeded our expectations. We have formed lasting relationships with all of the staff and ownership and look forward to a long and prosperous relationship for many years to come.

Clinton Muhe

AAA Private Money, LLC

I appreciate your attention to detail in the discovery of the accounting miscalculation in my favor. Drew, you and your whole team represent the highest standards of integrity. It is very much appreciated. Again, a very heartfelt “Thank You” to you and the entire staff at Del Toro for all of the effort put forth on my behalf in order to bring this transaction to a successful conclusion.

Jim Feller

Double F Management, LLC

California Private Lenders has been working with Del Toro Loan Servicing for eight years now, and it has been a great experience. Not only do they have a great servicing department, but they also do all of our loan/lender documents. The customer service has been beyond spectacular. If you want to deal with an honest, competent and reliable servicing company that will put you as a priority, you can count on Del Toro.

Mike Christl

California Private Lenders President

During our two years working with Del Toro, we have always experienced outstanding customer service and professionalism. Leah Ecija, who handles our accounts, exudes professionalism in any situation. Del Toro always goes above and beyond the call of duty. Their positive attitude and cheerful disposition are an added bonus. It is a joy to work with them.

Joyce Cham

Woody Financial Realty Corporation

AJX Homes has worked with the Del Toro Loan Servicing team since 2010. We can’t say enough about how much they help make our flipping business run smoothly, from purchase to resale! Helping us quickly prepare and process loan documents for investors and escrow is the key to repeat business. We appreciate all the help Drew and his team have given us throughout the years.

Miguel A. Molina

AJX Homes LLC

I have reviewed the loan documents and, as usual, Del Toro (Katherine) has done an excellent job.

Dr. Stuart Weiss

Drew, Here’s to the man with the courage to fight, Here’s to the man, who did not let the bastards grind him down, I am grateful for all your efforts on my behalf, Here’s to the sweet smell of success.

James P. Feller

Double F Management Group, LLC

“Yes,” Pensco wanted the fully executed extension this morning and I had it! Both PS Modern and I have found you to be a wonderful person to help us. You have been positive and upbeat about making this easy for all of us! Thank you!

Howard Hyman

Fremont Bank

Catching 100 waves at the event reminded me of how powerful a community can be.

Just to share a little, I’m really proud that my ten person team raised $40,000!! That is enough to open two new schools this year.

The total event has raised $350,000 and donations are still coming in.

Sean Puckett

You guys are the absolute best!

Barbara Cuillo

Mortgage Securities

Recently, Sequoian Investments, Inc.’s success was recognized by the San Diego Business Journal as San Diego County’s Number One Fastest Growing Company for 2016- a list which represents companies in every sector of San Diego’s business community.

One of the ways we maximized our success was to strategically align ourselves with industry experts who share the same values of our company. One of those companies is Del Toro Loan Servicing, Inc.

Del Toro’s ability to tailor services to our specific needs (Loan Processing, Doc Drafting and Servicing) not only helped us achieve the success we’ve experienced, but also landed Del Toro in ranks of the “Fastest Growing Companies” San Diego as well.

We consider Del Toro a valued partner and we highly recommend anyone In the industry consider them as their primary resource or as a backup partner when your workload demands it.

Alexander Pellegrino

Sequoian Investments, Inc.

Our payoff that was short more than $9,000. Escrow explained that Del Toro’s Demand was inaccurate AND that the borrower was only required to pay only the amount on the Demand. AMAZINGLY, Del Toro management quickly accepted responsibility and told us to expect a wire the following day (which we did). That’s integrity…

Blue Sky Capital

You are doing an excellent job in sorting out this rather complicated matter.

Bob Holt

Dear Drew,

I am very pleased with your help on our case. You were very knowledgeable and accessible when needed. I think that your identification of issues was helpful in obtaining a fair settlement of the case. I would highly recommend you to any persons with a need for an expert witness in the note/deed of trust /securities law field.